VNG Sharing Plan Nets Record $4.7 Million for Customers February 18, 2004
Asset Management Agreement With Sequent Energy Management Results In Total Savings of $9 Million Since 2000
NORFOLK, VA - February 18, 2004 - Virginia Natural Gas (VNG), a subsidiary of AGL Resources Inc. (NYSE: ATG), announced today that its Asset Management Plan, managed by Sequent Energy Management, another AGL Resources company, saved VNG customers $4.7 million in 2003. The benefits realized during 2003 will be shared throughout 2004 in the form of reduced gas costs. Since the plan's inception three years ago, VNG customers have received approximately $9 million in savings through reduced gas costs, which equates to an average of approximately $35 per customer.
"Having our assets managed by Sequent has been a tremendous benefit for the customers of VNG," said Hank Linginfelter, president of Virginia Natural Gas.
"The $4.7 million reduces overall gas costs for our residential and small business customers. The reduction does not appear as a line item on the gas bill but is reflected in the gas cost calculation applied to the customer's bill," said Jodi Gidley, vice president of operations for VNG. "We are pleased to be able to deliver cost savings to our customers, especially since the last two winters have been colder than normal."
The progressive value-sharing plan approved by the State Corporation Commission in 2000 requires VNG to optimize or increase the value of its interstate pipeline contracts and storage assets.
The plan is administered by Sequent Energy Management, VNG's asset manager. Sequent delivers gas to VNG and coordinates the use of VNG's assets, making them available to other energy companies when they are not in use serving VNG's residential and business customers. Sequent participates in sharing only after reaching a pre-determined minimum level for VNG and its ratepayers.
"With Sequent overseeing VNG's assets this winter, the plan continues to generate value, which is expected to result in additional savings for our customers," Gidley said.